A New Political Climate for Global Warming: The Political Climate with John Raidt, James Raidt, Denis McDonough, Todd Stern and James Kvaal. Rick Klein moderates.

As part of its Opportunity 08 series, The Brookings Institution hosts Democratic and Republican campaign policy advisors in its second forum on the nation's most pressing policy challenges.

The issue of global warming is now a key issue in the 2008 presidential campaign, sparking a larger debate about energy use and provoking policy prescriptions ranging from diplomacy to conservation to investing in research and harnessing market forces.

Rick Klein

Rick Klein is a senior political reporter and the author of The Note.

James Kvaal

James Kvaal is a John Edwards for President policy advisor.

Denis McDonough

Denis McDonough is currently serving as President Barack Obama’s Chief of Staff, a position he assumed in February 2013. Prior to assuming this role, he served as the Deputy National Security Advisor from October 2010 to January 2013. He also served as the Chief of Staff of the National Security Staff and as the Deputy National Security Advisor for Strategic Communications.

Hi everyone. My name is Rick Klein, I'm a senior political reporter withABC News, and happy to be with you this morning, and thanks, everyone, for attending. This panel isgoing to be a little bit different than the last one. We're going to take some of the lessons we learnedbefore, some of the things we know already, and move it into the context of the 2008 Presidential Campaign.And as you all know, this is an issue that's very ripe right now. We're not hearing a lotabout it yet in the 2008 campaign, but we will continue to hear about it, and we've seen really thisentire issue change over the last few years in a pretty extraordinary way, where there really isn't amajor debate in Washington anymore over whether climate change is happening, it has moved to what we're going to do about it.But there's been, I think most would agree, very little action on that front, and that'sreally where our panel comes in. We have representatives from four of the Presidential campaigns. Ishould also note that we extended invitations to the Romney and Giuliani campaigns and they declinedto send participants, although they did express an interest in perhaps doing so at a later date. So I'd liketo just briefly introduce the panel, and we'll get a discussion going, and then leave a lot of time forquestions at the end. Starting right here on my right, we have Todd Stern, a Policy Advisor for theHillary Clinton Presidential Exploratory Committee. Mr. Stern is part of the Wilmer Hale practice herein Washington and a Senior Fellow at the Center for American Progress.James Kvaal, Policy Director for the John Edwards campaign joining us today fromChapel Hill; thanks a lot for making the trip. And Denis McDonough, Policy Advisor for the Obamafor America campaign, also with the Center for American Progress. And via video conference, thanksfor joining us, John Raidt, who is a Senior Policy Advisor for John McCain and a long time aide to Senator McCain.I'd like to start the discussion, just instead of opening statements, just asking everyone togo down the line with one particular question, and that is, what the single most important thing that thenext President can do to address climate change. What are we going to see in the first hundred day, say,of the presidency of the various campaigns that you represent? Mr. Stern.Well, I would say most broadly, Rick, that -- I think that Senator Clintonwould completely reverse the approach that this Administration has taken by reasserting the WhiteHouse leadership, both the domestic, front, and abroad, and recognizing that we have a moment here, Ithink we have a genuine moment of challenge and opportunity with respect to the climate and energy issue.This Administration has been in a state of denial for the last six and a half years, and both oildependency and the greenhouse gas problem has gotten a lot worse. I think Senator Clinton is abeliever in solving problems and a believer that the American people rise to the challenge if they'regiven that challenge and they're given some leadership.I think there's three ways fundamentally that you can reduce greenhouse gas; one is tosignificantly improve the efficiency in the way to use fossil fuels, second is to substitute out other kindsof fuel, other kinds of energy instead of fossil, and the third is to capture and sequester omissions fromfossil, and she's going to move on all three fronts.And I think decisively three I think main areas, policy areas in which she's proposing todo that, one is an aggressive cap and trade program, another is significant, robust efficiency standardsfor cars linked together with manufacturing incentives so that Detroit can get onto the field in acompetitive way with respect to high efficiency cars, and then in addition, she propose a strategicenergy fund which is really designed to kind of divert, move incentives away from oil companies into clean energy.And then finally, I think that she's quite aware that this is a global problem that's got tobe addressed globally. And I think the only viable way to go with that is, first of all, to reestablish U.S.credibility by enacting a convincing program here at home, a convincing mandatory program, and thenin addition, an active effort diplomatically, at all levels, not just the broad UN level, but also thesmaller groupings, like the G8, and in an aggressive bilateral diplomacy, in particular with China and other key countries.I would certainly agree with what Todd said, that this is both a hugechallenge and a huge opportunity, that's how Senator Edwards sees it, as well. Global warming requiressome dramatic changes without really rethinking how we power our economy in the coming decades.We're going to have potential for tens of millions of refugees every year, ultimatelyhundreds of millions of people starving to death. So this is something that we need to start acting onnow, but it also creates a tremendous opportunity for us by building what he calls the new energy economy.We can create new jobs across American, we can revitalize rural areas with bio fuels,wind and solar, we can revitalize our manufacturing industry, we can take advantage of the sameinnovators that led the internet boom and are now investing in clean tack in Silicon Valley.I think the single most important piece of that is putting a price on carbon omissions, tosend the signal that our economy is going to be run different in the future. Senator Edwards hasendorsed a goal of reducing carbon omissions by 80 percent by 2050, and that's based upon what thelatest science says is necessary to prevent the worst impacts of global warming. So he thinks it'simportant that we take the steps that are necessary to protect our climate and not begin compromisingbefore it's over. He also has proposed auctioning off $10 billion of these permits to finance the newenergy economy fund, which would invest in renewal of energy, energy efficiency, and also help someindustries make the transition to the new energy economy, the auto industry and the coal industry in particular.So that I think is the single most important thing that he has proposed. And from thereaction that he's getting out on the campaign trail, I think people are ready for it. One of his biggestapplause lines is that it's time to ask the American people to be patriotic about something other thanwar and to try and make the transitions we need to address global warming and shift to cleaner for energy.Thanks, Rick. If I had to put a word on it for Senator Obama'sefforts on energy and climate, it would have to be urgency. I think that he recognizes very clearly thatthis is an urgent problem that we've now lost far too much time in addressing and that it can't, frankly,wait until he's in the White House, but when he is in the White House, he will make this a principalassignment that's handled, issue priority area that's handled from the White House itself that will allowa multi-faceted domestic energy conservation efficiency effort, coupled with a very aggressiveinternational diplomatic effort, to make sure that no only are we taking the right steps, but the nextgeneration of leading admitters are doing the same thing.Let me just give you a couple of examples. I think, as both Todd and Jim said, that theeasiest step that we can take is also the cheapest, which is efficiency. There's no reason that we can'tsave as much as 20 percent of the energy that we currently consume in this country by just being moreefficient about how we use it.Secondly, we have to ultimately look for alternatives to fossil fuel. And Senator Obama,again, is not waiting for 2009, January 20, 2009, he's actually moving now. He just introduced a veryinnovative alternative fuels standard, a low carbon fuel standard, that seeks to incentivize the use oflower carbon alternatives to oil and gas for our transportation fuels by setting -- mandating a veryaggressive target at 2015 and 2020, so that we get to that point in 2020 where we're already well alongthe way toward the notional goal that Jim just talked about, which is an 80 percent reduction over 1990 levels by 2050.And then lastly, it's just, as I think you'll hear from each of us, far past time for theUnited States to not only join the rest of the world, but lead the rest of the world in an effective cap andtrade system that mandates very aggressive reductions, but also creates the incentives and creates thecapital to make sure that we have revenue to fund the next generation of low carbon alternatives, bethey electricity alternatives, transportation fuel alternatives. At the end of the day, the cap and trade is the start of that effort.And again, he's not waiting for 2009 to do that, he's aggressively supporting as manyproposals as he can in the Senate to get that done. And I think you'll see during the debate, in theSenate in June and July, his aggressive efforts to do just that. So at the end of the day, if I could put one word on it, it's urgency.This is a problem that's far past its prime. There's not even any debate about whether it'sa problem or not, which is actually progress in Washington, but it now has to be confronted with the urgency that it demands.Rick, thanks again for letting me join you, I appreciate the opportunity. Ithink if I would have to choose one word, it would be leadership. We're at a very critical time wherethe confluence of three great challenges, and the national security implications of climate change, theeconomic security of climate change, and the environmental challenges, we have this confluence ofthese three great challenges, and it's really going to take leadership to bring all sectors of a societytogether to move forward in a responsible way. Senator McCain is certainly no newcomer to this issue,he's been talking about it for a long time, and had a proposal in the Senate a number of years co-sponsored by a number of his colleagues including Senator Lieberman, and so he's been with this for awhile and will continue to show the leadership necessary to move forward.And I'd like to start with you, Mr. Raidt.I happened to notice the other day, the Associated Press had been asking the variouspresidential candidates to name the last book of fiction that they read, and Tom Tancredo aCongressman from Colorado who's running for President said, Inconvenient Truth by Al Gore.Now, Tom Tancredo is, you know, not among the top tier of candidates right now, butthere is a major segment of the Republican Party who continue to believe that global warming is notoccurring. Obviously, James Inhofe's greatest hoax that was perpetrated on the American people line has become famous.Does Senator McCain plan to challenge the other candidates on this issue, to say themit's no longer a question of whether it's happening, we have to move beyond the debate, and to getbeyond the slogan on it? Can he do that without risking some kind of backlash in the Republic Primaries?Yeah, I don't think he worries about backlash. He believes what hebelieves, he believes the facts are clear, the consequences warrant- are moving forward, and other candidates are going to believe what they believe, and the best he cando is stick by his convictions.He delivered a speech a couple of weeks ago at the Center for Strategic InternationalStudies where he laid out his views about the importance of climate change and that we are past the debate on science.There's always a rhythm to these issues, they go back to clean air after any of the majorenvironmental laws that have been passed have been beneficial. First there's the denial that there's aproblem, and then once that is over with, then people start talking about the fact that, well, let's study itsome more, and then there's the voluntary aspect of it, and then it becomes partisan, and then finally,because the public is demanding something, we get over the partisanship and actually pass something that's necessary.So I think this issue is going to take that same path as these others have, and I thinkSenator McCain will just continue to focus on what the facts are and what he sees as the path forwardthat's best for the country and let other candidates speak for themselves.Coming at it from the other side of the political perspective here is theidea of a carbon tax. And we heard Greg Easterbrook talk about it a few minutes ago, and certainly it'swhat all economists who studied this issue will tell you is the most effective way to go if you really want to control omissions.It's not enough to do cap and trade, maybe you compare it with cap and trade, but really,a carbon tax is where it's at. We're hearing that from Senator Don on the campaign trial. To this date, Idon't believe he's got anyone with him; why not? Let me ask the surrogates for the -- the Democraticcandidates, why not a carbon tax, is it just too politically difficult to get through, do you think it's bad on policy grounds?Well, you know, I think that a carbon tax is certainly an idea that is outthere and a lot of economists look at. I don't think there's quite as much uniformity as you mightsuggest. I think there's two ways fundamentally to, in effect, impose a price on carbon.I think everybody, Denis or somebody said here that, or James, that what's crucial isputting a price on carbon so that people in businesses and everybody in the country acts accordinglyand makes judgments accordingly.think that's clearly right. You can do that through a carbon tax, youcan do that through cap and trade. I think that cap and trade has a significant advantage over carbontax in that you get a lot more certainty with respect to the ultimate goal, which is to limit the amount ofomissions. So in a cap and trade, you say omissions can go to X level, and you have a greater level ofcertainty in doing that than you would with carbon tax.Senator Clinton has a lot of focus actually on taxes, but her focus is on reorienting theway tax incentives work right now, which are way too heavily skewed toward the oil industry and oilcompanies, and her strategic energy fund proposal or legislation that she's proposed in that regardwould, again, would reorient those tax incentives toward clean energy, and her sense is that that's the best way to go right now.Well, I'm not sure I see the advantage of doing both. You know, they are-- I think this idea out here that if you were brave and honest that you would be doing a carbon tax is not necessarily true.As Todd said, a cap and trade -- well, I mean the way I look at it, a carbon tax is a toolto get at your goal by raising the price of carbon, but it doesn't actually set the goal itself. A cap andtrade system sets the actual goal and provides some certainty that you will actually achieve the level ofomissions that you're looking for. It's not -- you don't have to guess at what level of tax to set. So Ithink that's a big advantage of a cap and trade, especially when we're dealing with an issue as importantas global warming, where we really don't want to step across the red line and create, you know, thevicious cycle of feedback effects that could be irreversible.Another advantage of a cap and trade system is that it's consistent with the rest of theworld, and so I think it's going to be easier for us to go to other countries and put our commitments onthe table and show that they're comparable to their commitments if we have a global cap and trade system.Denis, I'd like you to address, and also if you can talk about how do youavoid the pitfalls in the European model; do you have any ideas?You know, Rick, it's a good question. It's astounding to me thatsometimes when it's time to emulate something that's happening in the rest of the world, we say that,well, they failed at it so we're going to fail at it, too, when, in fact, the American -- more often than notis that regardless of how the rest of the world does that, we can succeed at it.And I think the cap and -- the EEUETS is a perfect example of that. I think that there isgallons of ink being spilled on American papers at the moment about how failed that system is, and as aresult, how failed our system would be, as well, when, in fact, a more pertinent and more accurateexperience is the sulphur market and the acid rain market in the northeast and over the last two decadeshere in this country, which got to reductions by using a cap and trade model, got to reductions muchquicker, much more cheaply, and much more effectively than we might have -- than all the nay-sayers were saying at the time.So at the end of the day, I think we ought to certainly take advantage of the experiencethat has been developed in Brussels through the EEUETS, but there's no reason that we should thinkthat the country that came up with a very effective model on acid rain cannot do exactly the same thingas it relates to carbon omissions.I would; and obviously, Senator McCain has been a foremost proponentof cap and trade. The problem with a tax is that it won't work, it'll end up just raising money for thegovernment, for bureaucrats, there's no guarantee where that money would go as opposed to setting astandard that has both economic and environmental integrity and letting America do what it does best,and that's innovating -- to meet a goal.This idea of just slapping a tax on, it doesn't hold water, and I don't think it has supportamong the public, nor does it have support in Congress. So cap and trade is a market driven, proven,we've done this before, we can do it again and get it right.I wanted to talk a little bit about other energy sources that we could bedeveloping here, and a couple of questions, first with regard to nuclear; do you see a role, do yourcandidates see a role, a major role for nuclear energy as part of an effort to achieve energy anddependence? And we'd love to throw around the slogan about energy independence, energy security.There's been a lot of concerns about nuclear over the years, have those concerns been answered?Maybe to vary it up, we'll start with Denis, if you don't mind.Well, I think that Senator Obama believes that, particularly in acarbon constrained economy, where we are taking account of the -- urgently taking account of theimpact of carbon omissions on the world, that nuclear should be on the table. At the same time,however, there's a lot of different things that -- principally three big variables that need to be addressed,and first, obviously, is some kind of resolution on waste.Senator Obama has been very solidly against using Yuka, and it seems to be that theinsistence of the Administration on that has helped create this paralysis on getting some other workable solution.Obviously, there has to be a very aggressive effort to increase public confidence, andwaste is one variable of that. And ultimately, we also have to make sure that we're doing a better jobon reactor safety. So, look, it's got to be on the table, particularly in a carbon constraint, but it's notgoing to get there unless we can resolve these three outstanding questions.He's said that he does not think that we should be building more nuclearpower plants until we resolve the waste question. Obviously, there are a lot of problems with the YukaMountain depository, which is what we've been pursuing now and spent billions on, and there are stillquestions about whether it can be kept safe from water, which is a primary threat, of course. And so inhis view, we should not be building more nuclear power plants until we know that we can dispose of the waste safely.Do you think that's realistic, Todd, to talk about this without talking about Nuclear.Well, no, I think Senator Clinton thinks that nuclear has a role. I think,once again, there's a lot of violent agreement running around this room. But I think that her view isprobably quite similar to the one that Denis just expressed with regard to Senator Obama.Nuclear right now supplies 19 percent of our electricity. If you imagine that those plantsjust faded away, you'd have 19 percent of the nation's electricity that suddenly was -- if it wasn'treplaced by renewables, it would potentially cause more greenhouse gases going to the atmosphere. Soyou've got plants that exist, you've got plants that have to get their licenses in some cases renewed. Ithink that it needs to be part of the equation, but you've got four big issues which are cost, safety,proliferation, and waste, and all of those are going to have to be dealt with.So I think that Senator Clinton sees this as part of the equation, but with some verydifficult questions that need to be wrestled, but that we need to wrestle with, not just that we should saythey're tough questions, so we shunt it aside, but that we've got to wrestle with them.John, any thoughts on nuclear? And let me throw a clean coal in the mix,too. There's another one that we see some disagreement, whether it even exists, whether clean coal technology is realistic to expect.Right; first on nuclear, Senator McCain has been a long standingproponent of nuclear power. He doesn't believe you can be serious about the problem of globalwarming and not serious about the nuclear part of the answer, and as Todd had mentioned, is 19 -- 20percent of our current electric production, and the fact of the matter, it will be going away, because asthe plants start decommission, that's going to get a lower and lower and lower figure, and unless webuild more plants, it's not even going to maintain its 20 percent figure, which again, in this carbonconstrained world, it's vital that it be a part of the mix. So when you look at other countries, whether it'sBelgium, or France, or Japan, and see the percentage that they're using, America knows how to -- we'vegot over 100 plants, we need to be able to replace and build more to meet our goals. And I think that'swhy you see a lot of former opponents of nuclear power taking another look at it.The former head of Greenpeace has become somewhat of an advocate, and others, so it's clear we have to do this.One more thing on nuclear, Senator McCain, among the first items that he -- rememberCongressman Udall was a great advocate of the environment, he and Udall worked together on nuclearpower and building plants that can be standardized and Udall saw the importance of nuclear to thefuture given air quality and climate, et cetera, and so it is important to move forward.On the coal issue, we've got to be able to use our abundant resources of coal. As amatter of energy security, it's just essential. Senator McCain in his speech at CSIS talked aboutcountries, including China, being able to use our abundant coal sources in a way that meets our environmental needs--it's essential.Rick, let me just put one thing on the table, too, before we go towhich is the overall usage of electricity in this country can actually come down. I think you haveheard that in as Todd would say violent agreement. In California they use half the per capitakilowatt that the rest of the country does. Denmark has seen robust growth over the last 10 yearsdespite the fact that their energy usage has basically remained the same. So efficiency is vital.Secondly, on clean coal, I think that Senator Obama has been very clear that coal willhave to be used in this country. He has also been very clear that things like coal to liquid should be onthe table when we can sequester the carbon greenhouse gas byproduct of that technology. Last yearChina brought online as much electricity capacity as there exists in the entire U.K. So in 1 year Chinahas brought on so much robust electricity capacity to fuel that growth in that country and it isoverwhelmingly powered by coal. So if we can't get the technological advances and the innovation thatwill lead to not only our using coal cleaners but also then leading the world to use coal cleaners and inso doing generate jobs on this side of the ocean, then I think we're all going to be in a world of hurt. Soclean coal technology is definitely on the table. It's going to take some leadership in the White House,and that's exactly what he's going to do.Yes. I would say unlike nuclear where nuclear plants are very expensive tobuild and take a long time to build and are never going to be a large part of our solution, like it or not,we're going to be using a lot of coal for a long time. We have a lot of it. So we need to find a way touse coal in a way that does not contribute to global warming.Senator Edwards has proposed requiring all new coal plants to be built with thetechnology we need to capture carbon emissions so that those carbon emissions can be pumpedunderground. We don't have all the technology we need to do that successfully. Senator Edwards hasproposed spending a billion dollars a year to accelerate that technology as quickly as possible. But atthe same time, we need to start building coal plants now that have the capability to capture these carbonemissions because if we let coal plants get built now without that capability, we're locking in decadesof very high carbon emissions levels.A few points on coal, and we do have a little moment of disagreement onthis point, not on the broad front. The broad front is coal is absolutely a critical part of this equation.Eighty percent of our electricity is generated by coal which translates into about a third of all of ourcarbon emissions in the economy. They were not that many years ago talking about coal as part of thesolution. Coal is sort of a dirty word in more ways than one, but it is a critical part of the equation nowbecause it's a plentiful and cheap fuel and we're not going to banish it overnight or even for the nextdecade. So we have to pursue it.The elements of the technology are all there. What hasn't happened is that theyhaven't been put together and demonstrated at scale and in full-blown demonstration plans. That'sgot to happen. The MIT report, a very good report, came out recently on the future of coal and callsfor I think something like five domestic facilities, full-scale facilities in different geologiccircumstances and overseas as well. Senator Clinton has called for $3-1/2 billion I believe tosupport RD&D, research, development and demonstration for such plants as part of her strategicenergy fund and this needs to go forward rapidly.The one little point of disagreement I would say is that I think Senator Clinton would beat least skeptical about the coal to liquids equation. Coal to liquid is a high-carbon creating form offuel. If you don't sequester the carbon, it's about twice as polluting as oil, and even if you do sequester90 percent of the carbon, it still going to be a bit more polluting than oil.We have two challenges here which is oil security, we want to depend less on foreign oilbut less on oil altogether for national security and other economic reasons, but also the climatechallenge. We don't want to solve one, the oil security problem, while creating a bigger problem on theclimate front. So at least some healthy skepticism on the coal to liquid side.One more round before we move to questions. This round I would like tostart with our one Republican. Sorry to pick on you here, John. What can the next administration reallydo, and tell me what specifically President McCain would do to exert leadership on this question?Because as we know when we talked about the growth in energy use in China and India and others, ifwe do this alone, we are not going to be addressing climate change. We can get others to follow ourlead, but that's a lot different. As step one obviously we're doing what we're talking about on thispanel. Step two I would imagine is getting the world to follow. What can President McCain do on that level?That's correct, and as Gregg had pointed out, we didn't anticipate thatChina's image would exceed ours for quite some time -- happens next year, it may even happen thisyear. What Senator McCain has said is that there are many reasons domestically why we need to havea cap and trade system and reduce greenhouses again as a matter of energy security, as a matter ofenvironmental security, and as a matter of economic security. The technologies and the processes andenergy sources that this would need going forward, that America should be at the forefront ofdeveloping those. So I don't think he thinks we should wait until the rest of the world acts for us toexercise traditional American leadership. So there are plenty of domestic reasons why to do that.I think that as we do that for our own reasons, reaching out, and as president I'm surethis is what he would do, reaching out to other countries not only as a matter of commerce, but here, wehave the way to do this, to be able to have the abundant economical and environmentally safetechnologies that we can sell the rest of the world.And then I think one of the things that his bill does is allow us offsets from otherareas. In other words, if you have a cap and trade system, that you're able to buy credits elsewhere. Ithink that naturally will involve other markets, et cetera, but I think it is a matter of, one, doing itbecause it's the right thing for America to do, exercising our leadership, and then working with othercountries to bring them in not only just as a matter of politics but a matter of commerce.How about using trade pacts as a way to bring environmental standards and force other countries to boost their standards?That is always a very sensitive issue because free trade is an importantthing from any standpoint and it's always difficult when you complicate it with a lot of other issues thattend to make trade agreements never happen which is a negative for the United States. But I think onits own merits, the rest of the world is perceiving a need and an interest in doing this. I think just asyou get over the learning curve and the urgency that is apparent to us, it's going to be apparent to othercountries as well. I know China has a long, long way to go as does India and other countries, but Ithink they are going to come to see the importance of this for their own self-interest as well.There is no question that it's a critical part of solving this problem. Hesays that the first step is of course to get our own house in order and we are now one of three countriesthat is not signed on to Kyoto. So the first step is to start making some real commitments of our own to restore our own standing.The second step is to offer to work with some of these countries and share the energyefficiency and the clear energy technology that we're developing and that is something that will notonly help them along the road but also create markets for exports for American businesses.Finally, yes, if we're having trouble bringing along, he has said many times that hebelieves trade deals should have labor and environmental standards and he is open to making globalwarming commitments a part of that.I think that Senator Obama would see trade agreements andenvironmental standards as a very useful tool. I also think that when you looked at, Todd talked aboutdeveloping the technology for carbon sequestration, the European Union currently has a pilot projectthat they're working with China on. There is no reason that we shouldn't be looking for waysinnovatively to develop this technology overseas, obviously keeping in mind our intellectual propertyrights which is also astounding why the administration took 6 or 7 years to enforce the existing WTO agreement with China.And then just some very simple things. The Export Import Bank reported last year in itsannual report that it supported the export of $16 million in low-carbon energy from this country andupwards of $4 billion in hydrocarbons, simply backwards. At a time of huge profits for the oilcompanies we have the full bureaucracy of the American government aggressively supporting theexport of technology for hydrocarbons. It's not the way it should be.Consider further that the United States, the biggest economy in the world, if the fourthlargest producer of wind technology. It's lower than that on solar. These are tomorrow's technologies.You're looking at according to the Stern Report in any case by 2050 a half a trillion dollar market yearon year. We ought to be getting a piece of that market, but we ought to be doing it today using thetools that are at our disposal, not underwriting the export of hydrocarbon, highly carbon-intensivetechnology, but looking at tomorrow's technology and tomorrow's jobs to make sure that we're doing it.First of all, I agree emphatically with the comments that Denis just made.I think that we ought to be using our export credit agency and I think we should be encouraging otherOECD countries to be doing the same thing. I think we should be encouraging the World Bank to domuch more in the way of financing the right kind of energy and not the wrong kind of energy. I thinkall of that is absolutely right.On the broader and diplomatic question I think again there are two fundamental thingsthat need to happen. First is that the U.S. simply has to establish its own credibility here and thatmeans enacting a really serious and convincing domestic program. I don't think these things happen insequence, I think these things happen in parallel, but that's got to happen so that the U.S. has a voice atthe table based on what's doing itself.Secondly, it has to in fact reengage in a way that it absolutely has abdicated. There wassort of a signature moment early on. I digress for half a second, but Bill Antholis and I wrote an op-edin The Washington Post a month or so into the administration saying that Bush could be Nixon inChina on this issue, but he of course went exactly the opposite direction.The U.S. has to get back into the diplomatic area at all levels which is to say not just atthe broader multilateral level, although it does need to go there, but it also needs to engage at smallergroupings. Tony Blair at the Gleneagles G-8 meeting 2 or 3 years ago brought in several of the topdeveloping country emitters, climate change was a central focus of that meeting, and brought China,India, and Brazil and some of the others into that meeting. That is an important kind of forum forinteracting and I think that the U.S. has to develop a very serious bilateral approach to key countriesand in particular China. China and the U.S. are the 800-pound gorillas here. There is just no questionabout that. We have a common interest and this is an area where a real partnership is possible done theright way, but the issue has got to not go to the bottom of the talking points and the bottom of the list ofthe president's priorities, but have to be a central part of U.S. diplomacy at the bilateral, the smallmultilateral, and broader multilateral levels.I would like to turn to questions for the remainder of our time here. We'vegot about 20 to 25 minutes, so hopefully get some of them answered. Feel free to address questions toindividual panelists or to the panel more generally.